Toxic mold action against a landlord & management company; Release of liability; Scope of release; Intended third-party beneficiary; MCL 600.1405; Extrinsic evidence; Shay v Aldrich; Latent ambiguity; “Firm”; Confidentiality clause; Rescission; Innocence; Stanton v Dachille; Effect of a breach

The court held that the trial court did not err by finding plaintiff-tenant’s claims against defendants-apartment owner (Abbott) and management company (DTN) were barred by a release agreement he signed in exchange for his relocation to a different apartment. Plaintiff alerted DTN of toxic mold in his apartment and requested that he be given a different unit. DTN granted his request on the condition that he sign a contract releasing it from liability. Plaintiff signed a release of liability and moved to the new unit. When his health deteriorated, he sued defendants. The trial court granted summary disposition for defendants. The court previously remanded for further development of the record, and the trial court reached the same conclusion. The court now rejected plaintiff’s argument that Abbott was not included in the classes of entities listed in the release as being protected by its terms. Because Abbott is clearly classified as a firm, it “is a third-party beneficiary under the terms of the release.” In addition, because there was nothing in the record suggesting plaintiff intended to separate defendants for the purposes of these proceedings, “the release unambiguously applies to both DTN and Abbott.” The court also rejected plaintiff’s claim that he nullified the release agreement by violating the terms of its confidentiality clause. “The trial court correctly concluded that, even if the record supported [plaintiff’s] assertion that he breached the contract, he cannot assert his own breach as grounds for rescission because he is not a ‘blameless’ party.” Affirmed.